News

Franchise, Phone Bills Percolate in Penn.

3/14/2008 8:00 PM Eastern

Pennsylvania lawmakers may consider a state franchising-reform bill, but the industries most affected by that bill, the cable and telephone companies, are teaming up to put their lobbying muscle behind deregulating voice-over-Internet protocol phone service.

Cable operators and Verizon officials testified last week before the state Senate’s consumer affairs committee in favor of SB 1000, which would prevent any government agency from trying to regulate the product.

Virginia, New Jersey and Delaware have already written into law that VOIP can be deployed without regulatory hurdles.

The state video franchising proposal — HB 1490 — was drafted in part by labor groups and neither cable operators nor phone companies like the bill.

“HB 1490 is a bad idea. You don’t amend or negotiate a bad idea,” Broadband Cable Association of Pennsylvania president Dan Tunnell said.

Most states adopting statewide franchise require a new provider to submit the names of executives, state office locations and a description of the intended franchise area. Pennsylvania’s draft bill goes further, requiring an applicant demonstrate the legal, financial, technical and managerial qualities needed to build and operate a system — much like the deep level of operating data local communities demand for cable franchises.

HB 1490 would also give the state Public Utility Commission up to four months to act on an application, a period during which three public hearings must be held. At the end of that period the PUC has the option to deny the application.

The bill also would establish:

  • A six-year franchise;

  • A requirement incumbents can’t be state franchised until their current pacts expire, unless the local franchiser consents;

  • A build-out schedule that requires new providers to reach 35% of their declared franchise areas within three years of launch. A quarter of those customers would have to meet a low-income test. By year six, 70% of the franchise would have to be served, including 30% low-income households. If the franchise is renewed for another six years, the provider would have to serve the all households in the franchise by the end of year 12;

  • And a rule that all installations, maintenance and customer service be done within the state.

The House consumer affairs committee has not yet had a hearing on HB 1490, according to the legislative Web site. There’s no date set for a vote to move the VoIP bill out of Senate committee, but Tunnell believes the measure has a good chance to move forward.

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